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A Venture Capital firm says techies need to get along with government:
From Airbnb to Uber, some of Silicon Valley’s most successful companies have been fighting regulators since their inception. Now, one of the tech industry’s most respected venture capital firms wants to help both sides of the battle make nice with each other.
Andreessen Horowitz announced today that it’s launching a new policy and regulatory affairs unit, and that it has appointed Ted Ullyot, Facebook’s former general counsel, to lead the shop. Ullyot, who worked at both the White House and the Department of Justice before coming to the Valley, will be tasked with helping the firm’s portfolio companies see eye to eye with the government regulators with whom they’re increasingly butting heads.
Well, what do techies say, agree with the VC or string them up by their toes and poke them with sticks? Inquiring minds want to know...
(Score: 3, Insightful) by The Archon V2.0 on Friday April 17 2015, @12:10PM
> Well, what do techies say, agree with the VC or string them up by their toes and poke them with sticks? Inquiring minds want to know...
I question your mind if you had to inquire.
(Score: 1, Insightful) by Anonymous Coward on Friday April 17 2015, @12:25PM
Why? The answer could still be "no", in case techies think stringing them up by their toes and poking them with sticks is not the only alternative to agreeing with them.
(Score: 3, Insightful) by edIII on Saturday April 18 2015, @02:00AM
I agree, and in a related note, I was reading about Persian methods of execution/torture.
In essence, they are asking for techies to betray their fellow citizens in the interests of greater profits for a group typically entitled to 90% of it anyways. So the level of greed is terrifically and horrifically transparent. Tragically, their shortsightedness as well.
The VC people incorrectly have concluded, that belonging to the 1% will save them. It's not an unreasonable conclusion, as government is run by the people that can be bought for the correct price. However, that only guarantees them a slippery slope where an ever increasingly tyrannical government demands more and more. No more privacy at all for any American, but what's next? Just what does cooperation mean? Where does VC draw the lines?
To indirectly threaten techies with clouded motives in the first place, whether they like it or not, is to throw their hats in the ring. They're doing it for government. Just hope they remember the lessons of history on those that choose sides, and betray the public interest for short term profits.
There is no seeing eye to eye. What the government wants, it cannot ever have. Techies deal with reality . I can actually remember right now my first words when somebody described the Internet to me for the first time, and after I received my answer that just anyone could send packets to my machine. "Really? Those precious flower children are going to get their asses handed to them. You can't just let anyone communicate on your network. That's fucking nuts, over my dead body will you hook that up." What's my reality today? I quickly adopted the Internet once it became apparent that half the traffic was boobies. It's also one in which we just don't have any certainty anymore over our security. My original concerns were valid and prophetic. I've got firewalls, application layer firewalls, heuristics, RBLs, signatures, sand boxing, TPM, etc., and all of it because anyone can send me packets.
Techies are faced with a daunting enough task to provide security in very rough times (security wise and economically). As hard as everyone has worked, there has been somebody working equally as hard against them, or at least, certainly not cooperating. Now techies now just how insane this bad actor has been for all of us, and it's ramifications. It's not hyperbole to say techies woke up one day to find out a real life Super Villain was working in secret the entire time. I don't know how else to describe just how far reaching the fallout is over these revelations. I don't think Purism [puri.sm] could get started without it, and thankfully they're not venture capital. Their goals directly conflict with the governments at a fundamental level.
The government became the enemy by their actions, and nothing else. It only used to be rumor, baseless accusations, and the ranting of disenfranchised people. The truth moved rather fast over to a stark reality of the US losing billions in our technology sector from foreign fallout alone. Who's to say how it will end up too, but techies will never forget that the government cannot be trusted, and the businessmen will never forgive the government for creating the situation in which they can't act corrupt in the darkness anymore. Look how pissed Sony Pictures Entertainment IS? ;)
Anyone with a brain at all has already concluded the only road is one in which privacy is taken by force, and that will be technological in nature. All of the arguments have fallen flat, been sorted, and seen for their truth. Now the government is working to shut off the money to those that refuse to cooperate after 'butting heads'. That 'butting heads' being the government saying business as usual, or key escrow, and the techies are rolling their eyes, saying it's not technically possible anymore, and modern security refuses to acknowledge their proposals as approaching a state of security.
Funny thing, is that the techies deserve every part of it. That was a deal with the devils they signed. You deal with Darth Vader, you get progressively altered deals that keep getting worse all the time. Just when you thought you were going to get special treatment, the storm troopers are setting up camp and eyeing your daughters. It's kinda their thing.
(Score: 1) by t-3 on Saturday April 18 2015, @03:27PM
I agree, and in a related note, I was reading about Persian methods of execution/torture.
Are you talking about the one with the milk and honey and ants?
(Score: 2) by edIII on Sunday April 19 2015, @03:31AM
Yes. Yes, I was.
Technically, lunchtime is at any moment. It's just a wave function.
(Score: 4, Insightful) by Phoenix666 on Friday April 17 2015, @12:30PM
Yeah, it's a conversation-starter. I know where I stand, but the reader can probably infer that.
My sense is that the VC wants to have his cake and eat it, too. He wants his investments to be disruptive enough to earn him quick multiples on his dollar, but not have that disruption make any waves and trigger any lawsuits or government backlash. Of course that is impossible because when you are disruptive enough to earn a lot of money you have to do it by breaking the rules, because the rules to the game as it is are rigged; also, government, as the arbiter of that game, is a captured entity that has been captured by the very players your startup is trying to disrupt.
Washington DC delenda est.
(Score: 2) by kaszz on Friday April 17 2015, @12:52PM
The VC only wants the disruption within a certain range.
(Score: 2) by Thexalon on Friday April 17 2015, @02:05PM
Where did this idea come from?
There are 2 paths to real business success:
1. Create a useful service faster than anybody else so you become the de facto standard way of solving that problem before any other players are really in the market. See: Amazon, eBay. These players aren't playing the same game as everybody else, so rigging the game doesn't work.
2. Create a useful service that's better than anybody else's version, so you convince those who were using your competitors' version to switch to yours. See: Google. These players are playing the same game as everybody else, but they're playing it better and as a result are having success.
Both the cheating and the adverse consequences tend to happen after a business has become successful. The usual reason for that is investors expecting the company to continue to grow after it's already filled whatever niche it's trying to fill, and don't accept the idea of "Ok, we're the dominant player in X, so let's continue being the absolute best at X and rake in a good steady profit." What that means is that they expect businesses that have already beaten the odds (95% of tech startups fail) to do so a second time, and a third time, even though some of that is skill and some of that is sheer luck. Unable to meet those demands, the business instead starts to cut corners to fake growth.
The only thing that stops a bad guy with a compiler is a good guy with a compiler.
(Score: 2) by Phoenix666 on Friday April 17 2015, @02:29PM
The examples of Amazon and eBay are good instances of not playing by the rules. They stepped outside the legal regime that governs their competitors. Brick-and-mortar stores have to pay rent & sales taxes, comply with local regulations when siting their stores, etc, etc. All those things constitute a high barrier to entry for new competitors. Did they technically break the law? No, but neither did the established players when they captured the regulators and set the table to suit themselves.
Take another good, current example. Tesla is selling its cars direct to consumers, without going through the dealership system as do their competitors. Many states, as chronicled through articles here on SN, have taken to banning Tesla sales because they are disintermediating the dealerships. Now, I love Tesla, and love that they're being disruptive, but they are doing it by "breaking the rules." And because they are sidestepping the government and regulatory infrastructure that has long been bought and co-opted by established players, they are encountering the blowback the VC in TFA was wringing his hands about.
So I return to my original thesis, that you cannot become the kind of successful company the VC from TFA would love to have invested his money in without incurring blowback from companies/players that have thoroughly gamed the current system.
Once in a very rare while you'll have an Eastman Kodak whose business model will evaporate overnight, but had there been a single player, a startup, whose digital photography had been responsible and whom they could have sued into oblivion, you can bet they surely would have.
Washington DC delenda est.
(Score: 2) by Thexalon on Friday April 17 2015, @03:13PM
Aha, I see: You're talking about doing something different than their competitors. I was thinking you meant "Deliberately trying to avoid government-mandated responsibilities" (there are definitely businesses that do that, e.g. Uber). I take it "breaking the rules" is a catchphrase that means "Don't assume your competitors have figured out the best way of doing something".
Engaging in regulatory capture to try to prevent an improvement in an industry is a rearguard action that is usually doomed to failure. For example, if somebody in a state that doesn't allow Tesla sales really wants to buy one, they can have somebody they know in another state that does allow Tesla sales to buy one, then drive it to the state they live in (it's legal to own a Tesla, just not buy one direct from Tesla). Or, if there were a critical mass of potential customers in a state which requires a dealership in order to sell a car, they could set up a single dealership which was more like a depot than a retailer, offer home delivery on similar terms to their online sales, and then pay people to drive the cars from the dealership to the customers, which is still much more efficient than having dealers all over the state.
The only thing that stops a bad guy with a compiler is a good guy with a compiler.
(Score: 2) by frojack on Friday April 17 2015, @08:57PM
Tesla avoids dealerships, but doesn't avoid warranty issues, safety regulations, or other state laws.
If you live in a dealership required state you can still buy a Tesla. But you have to take delivery outside your state. You can visit a showroom in some other state. (Actually I believe Tesla showrooms are legal anywhere, you just can't place an order there, but they can hand you the paper work, you can mail it in or do it over the internet.)
Some states go so far as to limit free speech by outlawing discussion of price.
You can meet the delivery guy 6 inches outside the state border.
Someday the state will realize the sales tax they forego protecting dealerships isn't worth losing.
No, you are mistaken. I've always had this sig.
(Score: 2) by Grishnakh on Saturday April 18 2015, @02:22PM
Someday the state will realize the sales tax they forego protecting dealerships isn't worth losing.
How are they forgoing sales tax? Sales tax is based on your residence, not where you buy something. Try buying a car out-of-state and you'll find this out very quickly.
If you buy a car out-of-state and don't pay sales tax, you won't be able to register your car in your state of residence. You have to pay the tax at the time of registration.
(Score: 3, Insightful) by sjames on Saturday April 18 2015, @09:26PM
SOME states structure the tax so that it's owed for out of state transactions, others not.
(Score: 0) by Anonymous Coward on Friday April 17 2015, @06:02PM
You left off:
3. Inherit enough money so that no matter what you do with it, it multiplies exponentially.
(Score: 0) by Anonymous Coward on Saturday April 18 2015, @04:17PM
Thats the only way to get wealthy for sure, but being wealthy isn't the same as having a successful business.
(Score: 2) by DeathMonkey on Friday April 17 2015, @06:50PM
My sense is that the VC wants to have his cake and eat it, too.
A common flaw...
The general consensus on this site appears to be that "on a computer" shouldn't make something patentable. Yet, "on a computer" should make something exempt from existing law?
That seems like a pretty good example of wanting to continue to own the cake you have already eaten.
(Score: 4, Interesting) by bzipitidoo on Friday April 17 2015, @02:09PM
Work with the government? No! Run the government!
This is only more propaganda, and particularly offensive and boneheaded propaganda at that. Trust them? Trust the powerful?!? The rich and powerful get to run the government, and we're supposed to play nice and cooperate while they treat the nation and the world as their personal cash cow, security blanket, and dumping ground all in one? Hell no!
Many people have forgotten or missed the point, or, to be fair, were subjected to brainwashing, in their high school American History classes. America is all about distrust of power. The top priority of the design of the US government is dealing with the problem of "power corrupts". The design has worked to some extent, but currently we have huge problems with regulatory capture and money politics. The will of the people is routinely ignored, except for purposes of manipulation with propaganda clothed as science, or just plain anti-science. I wish it was the case that making this point makes you into Captain Obvious.
Further, as to who should be running the country, it would be better to have more brainy tech, engineering, and scientific people running our bureaucracies. I don't say all positions should have such people-- Herbert Hoover is unfortunately an example of an engineer who got it wrong because he focused too much on engineering thinking, failing to appreciate the magnitude of the looming problem and deal with the corruption in the stock market and business world until it was too late, and this despite the corruptions of the terrible Harding presidency only 2 terms before his own. George W. Bush also got it wrong, on Iraq and on the housing market bubble, but for the different reason that he was simply not that smart, and he had picked blind loyalty as the most desirable characteristic for his appointees. But techies are underrepresented in high office. Instead, we often get corrupt, greedy fools. There's this unwarranted sense that the primary attribute that appointees need is not intelligence, not good sense, not honesty, but business, political, or administrative experience. The top positions are all filled by businesspeople or politicians. One of the few exceptions was Stephen Chu. One of the worst bureaucracies is the SEC. The bureaucrats do their jobs, uncover all this insider trading, deception, and fraud, and then the bought tools in the top positions bury it all.
(Score: 2) by JNCF on Friday April 17 2015, @04:17PM
Work with the government? No! Run the government!
Destroy the government. Large power structures always go the way of corruption. If there is an answer to this problem, it is decentralisation.
Further, as to who should be running the country, it would be better to have more brainy tech, engineering, and scientific people running our bureaucracies.
Yeah, I'm sure that will go great. Then the large corrupt power structure will be able to spread oppression competently and efficiently. I think I'd prefer the thugs I know; at least they seem to bungle things up a decent amount of the time.
(Score: 2) by Bot on Friday April 17 2015, @07:30PM
Since we are discussing the obvious, I'd like to point out that a VC would never dare asking anybody to get along with X if he wasn't sure that X is under control. Venture Capitalism is about being able to evaluate risk.
In other words, if the government were the expression of a democratic system, VC's speech would not make any sense, because the government would be a pretty boring executor of a clear and easy to understand set of laws crafted by honest representatives.
Account abandoned.
(Score: 2) by CoolHand on Saturday April 18 2015, @12:29AM
Just for the record, that was Phoenix's question.. I just left it there even though I was pretty sure what the response was going to be...
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